Relationship of transformational leadership with employee creativity and organizational innovation A study of mediating and moderating influences

Purpose The purpose of this paper is to examine how creative self-efficacy and physical work environment mediate and moderate the relationship of transformational leadership with employee creativity and organizational innovation. Design/methodology/approach The data were collected from 254 managers working in two major automotive manufacturing units in India. The survey response rate was 81.9 percent. The data were analyzed using structural equation modeling. Findings The study findings suggest that transformational leadership augments employee creativity. The authors show that employee creative self-efficacy acts as a mediator and physical work environment as a moderator in the relationship between transformational leadership and employee creativity. Originality/value The study contributes by examining mediating and moderating influences in the relationship between transformational leadership and employee creativity. The data were collected from an important industry in a large, emerging economy that has received much less research attention relative to its size and significance.